Promoting competition - Financial Conduct Authority

Promoting effective competition

Published: 27/02/2015     Last Modified: 19/03/2015
We will promote effective competition in the interests of consumers.

We have shaped our approach to competition around the benefits for consumers, which includes better value, genuine choice, quality products and services, and useful innovation in financial services.

The balance we have to strike is in ensuring that only those firms that are able to meet certain requirements are authorised, while also not imposing excessive regulatory barriers that may then restrict new entrants and thereby inhibit competition, diversity and choice in the market.

We use market studies as a tool to analyse the effectiveness of competition in the markets we regulate, closely examining particular markets to explore any concerns we have. Find out more on how we carry out market studies.

Where we find problems we can intervene, for example through making rules or guidance, or using our enforcement powers.

Competition concurrency

From 1 April 2015, we have concurrent competition powers. This means we will have powers:

  • under the Competition Act 1998 to enforce against and fine for breaches of domestic and EU competition law prohibitions on anticompetitive agreements (for example, cartels) and abuses of a dominant position, and
  • under the Enterprise Act 2002 to make a Market Investigation Reference to the Competition and Markets Authority (CMA).

These competition powers may also be exercised by the CMA with regard to financial services and other sectors of the economy. This means that, in respect of financial services, the CMA and the FCA will have 'concurrent powers' and the FCA will be a 'concurrent regulator'. These powers are additional to our ability to use FSMA powers in pursuit of the FCA's competition objective.

We consulted on draft guidance on how we will exercise our concurrent powers. The consultation closed on 13 March 2015.

These new powers provide the FCA with additional tools to promote competition and tackle competition issues we identify in financial markets. 

We held an event on 6 March 2015 to enable stakeholders to discuss their views in advance of the consultation closing. View the slides from the event.